Introduction
ACODE is undertaking a Public Expenditure Tracking Study (PETS) in the health sector, with the objective of enhancing sound public expenditure management system in Uganda. The PETS is tracing the flow of budgetary resources from the Ministry of Health (MoH) to a sample of health centers for the last three financial years (2006/07, 2007/08 , 2008/09 & 2009/10) and will collect information on sources of income for the facilities, expenditures on basic services, and the practices of accountability at various levels. The study involves interviewing the administrators and facility heads to be able to capture the problems they face, how these problems may be resolved, and the quality of primary health care services and impact of the delivery of public services.

The PETS is not be an audit of the public financial management systems but rather focuses on identifying areas of improvements in the efficiency of the administrative system. Similar studies have been carried out in other countries and they seem to have created an impact on the way public funds are used. Therefore, assessing whether the amount of funds appropriated actually reached intended beneficiaries will be as important as the objective of finding out whether the system in place consistently allowed for this amount to reach facilities in a predictable and timely manner, and was accounted for.

The survey will be undertaken from June – September 2010. The sampling details are discussed under the methodology.

Background and rationale
It is increasingly being acknowledged that there are weak links in the chain from public spending to actually making basic services available to poor people especially in countries with poor accountability and weak institutions (Dehn, Reinikka and Svensson. 2003). Simply increasing budget allocations to essential services such as health and education is not enough to ensure that quality services are indeed delivered (Gupta, Gauri and Khemani. 2004). Reasons being that: government may spend on the wrong goods or the wrong people. Even when government spends on the right goods or the right people, the money may fail to reach the frontline service provider. Even when the money reaches the frontline service provider (i.e. primary school or health clinic), the incentives to provide the service may be weak. Even if the services are effectively provided, households may not take advantage of them (Dehn, Reinikka and Svensson, 2003).

Empirical evidence (that the impact of public spending on basic health depends upon the overall governance environment) provides an important explanation for the observed weak relationship between public spending and outcomes (Gupta, Gauri and Khemani. 2004). The role of institutions and incentives in the public sector to translate budgeted resources into actual outcomes is therefore vital. These issues are particularly important for the public delivery of basic health services in Uganda.

Despite government commitment to improving health outcomes, health expenditure as a proportion of government’s discretionary expenditure has stagnated at around 9.6% during the last ten years, yet the population increase and health care needs have been increasing, hence outstripping the per capita expenditure7. Such funding is inadequate to provide the Uganda National Minimum Health Care Package (UNMHC) in all facilities as envisaged: the per capita cost was estimated at USD 41.2 in 2008/09 and will be rising to USD 47.9 in 2011/12; yet budget allocations in the medium term estimation was at USD 12.5 in 2008/09, demonstrating a shortfall of almost USD 29. This trend has important implications for service delivery of health care in Uganda (MoH, 2009).

The challenge of investing in the promotion of people’s health will require the commitment of more public resources to the health sectors but more importantly, progress will depend largely on the efficiency in regards to the way resources are mobilized, allocated and used. For instance, the MoH headquarters continues to command a big chuck (over 50%), of the entire health sector budget, which is bigger than the entire allocation to decentralized services under Local Governments who are the key implementers of most programmes where the majority of the poor live. In addition, funding for national and regional referral hospitals remains inadequate and has remained fairly constant [at less than 20 percent of the entire health sector budget] for the last six years. With meager resources, most health institutions are increasingly finding it difficult to provide reasonable primary healthcare services. The situation is worsened by the weak capacity and corruption at local government levels to implement primary health care services.

There is still doubt whether institutions and incentives in the health sector in Uganda can actually allow large spending programs to effectively deliver basic services to the people. Key questions still persist regarding: what actual outcomes in service delivery can be achieved with the current public spending? Are public resources actually reaching their intended destinations? And how accountable are public service providers to their expected beneficiaries? This study will provide some answers to these questions through the analysis of extensive data on health care expenditures and service delivery processes and outcomes that will be collected through a survey including the central government, local governments and public primary health care facilities in Uganda.

By use of micro-level survey tools (especially the PETS) we shall be able to do a deeper investigation of actual outcomes in service delivery at the frontline and the impact of broader institutions of governance and financing arrangements on these outcomes beyond the aggregative tools of public expenditure analysis.

This PETS exercise will build on previous similar studies that have been undertaken in Uganda to assess the efficiency of public spending flows (see Reinikka and Svensson, 2001; Reinikka and Svensson, 2003; Reinikka and Svensson, 2004). In their 2001 study, Reinikka and Svensson found that on average during 1991-95 schools received only 13 percent of the central government's allocation for the schools' nonwage expenditures. There was considerable variation in grants received across schools that was determined more by the political economy than by efficiency and equity considerations. Larger schools and schools with wealthier parents received a larger share of the intended funds (per student), while schools with a higher share of unqualified teachers received less. These survey findings had a direct impact on policy in Uganda. As evidence on the degree of leakage became public knowledge, the central government enacted a number of changes: It began publishing monthly transfers of public funds to the districts in newspapers, broadcasting them on radio, and requiring schools to post information on inflow of funds. Consequently, when a similar study was conducted again by the same researchers in 2003, they found that on average schools received 82% of central government spending.

Objectives
There are six objectives of this study. These are:

1. Examine the estimates and actual flow of public funds in health and establish to what extent they reach the primary health care facilities.
2. Assessing whether there are delays and leakages in budget transfers within the health sector
3. Assessing the level of utilization (absorption capacity) and accountability (financial) of the budget transfers at the health care facility
4. Understanding the service provider attitudes and incentives in the provision of public health care services.
5. Examining the role of key actors and the accountability mechanisms at different levels (at national, local government and community level) in ensuring effective delivery of public health care services.
6. Assessing the level of community / citizen participation in demanding for effective delivery of public health care services.
7. Increase awareness and civic consciousness about the budget and public expenditure

Given these objectives the study will exclusively focus on the performance of public health facilities, focusing both on the supply and demand side determinants of actual outcomes (improved health indicators). It is important to note that the study is neither designed to address issues of public-private partnership in delivering basic services nor issues of household demand and responsiveness to public initiatives.


Contact details
Daniel Lukwago is a Research Fellow at ACODE. He has more than 7 years working experience with Civil Society Organisations as a Policy Analyst. He has reviewed and analysed Uganda's economic and development policies (especially macro and fiscal policies) from a pro-poor perspective. He has produced and peer reviewed over 15 papers on key public policy issues on development, poverty, governance, macroeconomic and fiscal policies. He has also done research assignments with the World Bank in Washington D.C and NGOs in Uganda. Daniel holds a Master of Public Administration (Programme in Economic Policy Management) degree from the School of International and Public Affairs; Columbia University in the City of New York, USA and a Bachelor of Science in Quantitative Economics degree from Makerere University, Kampala, Uganda. Daniel is committed to working to improve human development through research and advocacy to ensure that public policies are pro-poor.

• Readers can contact Daniel Lukwago for further details on the project and its progress at: 

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